Alibaba, JD.com, and Bilibili Fall on Report Tencent to Sell Meituan Stake

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Alibaba,

 

JD.com

and some of China’s biggest companies saw billions wiped off their value Tuesday following a report that

Tencent Holdings

was planning to sell all, or a large chunk, of its 17% stake in food delivery company

Meituan.

While there has been a widespread correction in the China tech sector, it’s unlikely to have triggered the potential sale by Tencent (ticker: 0700.Hong.Kong). More likely it will be to appease Chinese authorities who have taken a tough regulatory stance on the technology sector, issuing heavy fines.

A potential sale could also see Tencent take profits from what has been an eight-year investment in Meituan (3690.Hong.Kong), Reuters reported, saying financial advisors have been hired.  Shares in Meituan plunged 9% in Hong Kong while Tencent was up slightly.

Fears over a potential stake sale spooked investors in other China companies. U.S. listed shares in Alibaba (BABA) fell 1.9% in premarket trading Tuesday,

JD.com

(JD) was down 2.2% and

Bilibili

(BILI) down 2.3%.

Write to Rupert Steiner at [email protected]